Firmer & Flatter On Global Inputs

The impulse from a firmer core global FI complex, linked to soft U.S. data, a dovish feel to the minutes covering the latest FOMC decision, the prospect of further monetary easing in China and firm demand at the latest round of longer dated NZGB auctions fed into demand for ACGBs, allowing the space to firm on Thursday.

• That left YM +3.0 & XM +4.5 at the bell, with wider cash ACGB trade seeing 2-6bp of richening as the curve bull flattened.
• Bills were flat to 3bp richer through the reds come the close, erasing early losses to bull flatten at the margin.
• We didn’t get much in the way of headline flow to facilitate idiosyncratic moves, with the local data docket and speaker schedule somewhat empty.
• Looking ahead, Friday will bring the release of the weekly AOFM issuance slate and A$700mn of ACGB Apr-25 supply.